Archive for the ‘British economy’ Category

Northern Ireland’s First Minister and Martin McGuinness held separate press conferences after the meeting, with Sinn Féin’s Mr McGuinness stating his party’s assessment of the referendum results “is that there is absolutely no good news whatsoever about Brexit.”

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With the failure of this deal looking likely and the removal of Osborne, champion of yuan-trading in the City and defender of HSBC from US regulators, from government, you really have to ask if City of London interests haven’t been sacrificed to US interests by way of the Brexit vote. Is Wall Street then about to bypass London, its traditional point of entry into Europe, in favour of Paris or Frankfurt? Is this also a result of the obvious failure of TTIP? If there is a deal, what, if anything, does the UK get by way of compensation?

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Jeremy Corbyn is on safe ground in making a U-turn over Brexit. He had originally insisted that Article 50 should be triggered immediately but now seems to have backed down on this and is talking about the possibility of a second referendum after negotiations have been completed. Of course, there will be no negotiations until Article 50 is triggered but let’s not get bogged down in technicalities.

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Cutting interest rates will only further weaken the pound, fueling inflation and further undermining consumer spending. And so, we enter a vicious circle and a downward spiral. Brexit hasn’t caused this underlying economic weakness: it has merely prevented us from using our geopolitical clout to counter it as we could have done, for example, through the Comprehensive Strategic Partnership with China which was based on our role as gateway to Europe and, consequently, our membership of the EU.

Sterling fell as reports suggesting that the UK’s manufacturing and services industries contracted in July heightened speculation that the Bank of England will cut interest rates as soon as next month.

Johnson’s “everything will remain the same despite Brexit” argument reflects either that he is completely delusional or that he is strongly hinting that Brexit is not going to happen at all. Regarding passporting rights, that will be in the hands of the Europeans and it is no secret that Paris and Frankfurt are vying to succeed London as Europe’s financial sector. His assurances lack all credibility and reflect the bizarre post-Brexit limbo into which we have been cast. Meanwhile, as the incoming capital flows on which we are dependent dry up, the perspectives for the UK economy and living standards are dire in the extreme.

London will remain a global financial centre, according to Boris Johnson, the UK’s newly appointed foreign secretary. Speaking at the United Nations in New York, Johnson dismissed fears over the country’s financial services sectors losing its passporting rights amid the Brexit vote.

“In other words, despite its advantages in financial services and language, the UK’s ability to attract foreign investment is likely to be substituted by other EU countries. Once the UK loses its access to other EU markets after leaving the EU, it will also give away its advantage as a Chinese investment hub in Europe. In the same vein, as London loses part of its share of financial operations related to the EU, other cities such as Paris and Frankfurt should increase their capabilities as financial centres, with each probably specialising in different issues.”

This study confirms the obvious: that the UK will sacrifice a beneficial relationship with China by withdrawing from the EU. The irony is that, contrary to the claims of the Leave Campaign, we have lost strategic autonomy by voting “leave” and now appear to be acting in accordance with US interests. On the other hand, our engagement with China may not have been in good faith from the start, being only the other side of the coin of our anti-Russian foreign policy and our attempt to obstruct the emergence of a Washington-Moscow axis. In this case, Brexit could be seen as a salutary corrective although one which exposes the pre-existing fragility of the British economy.

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Here, then , is the plan. It is based on the usual humbug of Britain, the “great trading nation”, rather than the reality of Britain, the tax haven. Export-led growth is the policy embraced by Cameron after the 2008 crisis. Nothing happened. In order to have such a policy we would require massive investment in Britain’s depleted industrial base. For that, we require incoming investment. For incoming investment we require membership of the EU. China or India see investment in the UK as a gateway into the single market. Before recklessly throwing it all away we had already entered a strategic partnership with China which promised to achieve all these things. Significantly, Davies refers to “the deals which would most benefit us, such as those with Canada or the US.” Deals with other de-industrialised, debtor nations will do little for Britain’s export base. In reality, the political decision to align ourselves with the USA rather than Europe will do little for British industry or the British people. It will , however, be welcome in the City of London which will continue to receive incoming funds of dubious origin and in the areas of security and military- industrial complex.

“So we need to shift our economy towards a more export-led growth strategy, based on higher productivity employment. Fortunately, this will prove eminently possible as a part of a Brexit-based economic strategy. Indeed, far from being the risky option that many have claimed, Brexit gives us many tools to deal with the very serious economic challenges that the country will face in the coming decades.”

House Speaker Paul D. Ryan is calling on the administration to start talking to the United Kingdom about a new trade agreement to ensure “a smooth” relationship after the country parts ways with the European Union.